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HomeMy WebLinkAboutCity Council Committees - Fireman's Relief and Pension Board - 11/02/1993 i FIREMEN'S RELIEF & PENSION BOARD November 2, 1993 Boardmembers Present: Houser, Berg, Tilley, Jacober, Grenstad Others Present: Chief Administrative Officer McCarthy, Acting Finance Director Miller, City Attorney Lubovich, and Field Auditor Huntington Berg nominated Houser to chair the meeting in the absence of the Mayor. Tilley seconded and the motion carried. APPROVAL OF MINUTES Tilley moved to approve the minutes of October 5, 1993. Berg seconded and the motion carried. REPORT ON HOW OTHER CITIES HANDLE BOARD BUSINESS/BYLAWS Berg noted that he and former Assistant City Attorney Haenel have discussed operating policies for this Board, and that all other cities are paying medical benefits to retirees under the system and this Board is not because medical for retirees is being handled by the LEOFF system. Berg clarified that the draft operating policies for Kent do not contain information on this subject, as do the operating policies for other cities, McCarthy explained that when the last actuarial study was done it was determined that medical benefits for retirees amount to approximately $90,000 and the City is transferring $90,000 from the Pension Fund to the Fire Department General Fund for payment of those benefits. It was determined that most likely no more firemen will retire under the old system, and that the funds could be used for LEOFF firemen retirement. McCarthy suggested that this be looked at during the actuarial study process, and Berg agreed that the decision should be made after the study has been done. Tilley noted that No. 5 in Section 3.2 of the draft policies should say "selected" rather than "elected", and that 3.2.A should also say "selected" rather than "elected", as well as "alternate" instead of "alternative". He also felt 3.2.0 should say "Chairperson Pro Tem" rather than "Chairperson". Tilley also said that Section 4.2 gives the impression that the Board can decide whether to let the public attend the meeting, and that all meetings should be open to the public except during an executive session to discuss personnel issues. Lubovich agreed with Tilley that the wording in the draft is incorrect and should say that the meetings shall be public meetings. Tilley asked that the following words be added to the last sentence of the first paragraph of Section 5.0: "as long as there is no conflict of law". Berg stated that the third paragraph of Section 1 states that. Tilley voiced concern that someone would be told they cannot turn in a r claim because of a misunderstanding of this wording. Lubovich noted that State law would 1 prevail over any Board policy, and to put in more language would be redundant. Tilley stated that he would like to see it more in line with the law than the policy. It was agreed that the changes to Section 3.2, 3.2.A, 3.2.C, 4.2, and 5.0 would be incorporated into the operating policies. Tilley clarified that he is not opposed to Section 5.0 but is simply concerned about the claim process. It was determined that after the policies have been adopted, the Board will indicate that the Secretary has approval to tape the Board meetings. It was mentioned that Kent will soon have a 24-hour cable TV station, and Lubovich stated that lie will do further research regarding recording the meetings. Miller voiced concern that the second sentence in Section 4.3.A regarding payments is in conflict with the proposed resolution. Lubovich suggested saying something like "payments may be prepaid subject to subsequent review if such policy is established by the Board." Miller concurred, noting that otherwise payments could be held up. McCarthy suggested keeping financial transactions in a separate section from the records of the meetings, and renumbering the rest. McCarthy then suggested adopting the resolution and consolidating the wording of the resolution into the policies. It was agreed to put the wording in the policy. Tilley questioned the need to list who was paid, and Lubovich said it is not necessary to list them. It was determined that these will be called bylaws rather than operating policies, and Lubovich agreed to make the changes discussed and bring them back to the next meeting. i INVESTMENTS AND PAYMENTS - RESOLUTION Tilley stated that he would like the proposed resolution to say "temporary authority" rather than "authority to make investment decisions within the guidelines of investments allowable by state law", and "All investments and payments would be submitted for final approval and verification at the next Firemen's Relief & Pension Board meeting," Houser pointed out that this would hold up payments. Berg clarified that they want investments to be done rapidly and payments to be made at the proper time and approved at the next meeting. Tilley said the Board should not release the authority to make decisions. Lubovich spoke against adding the word temporary and suggested changing the language to say that the Board may authorize the city to make investment decisions, and to change the last sentence to say that all investment and payment decisions shall be reviewed and confirmed or approved. McCarthy voiced concern that after the city has taken action, the Board may want to reverse it. Berg pointed out that one city borrowed money from the FR&P Fund and never repaid it. He also noted that it is against state law to take funds out of one account and put them in the general fund without approval of the Board. Tilley stated that he is not opposed to giving the Finance Department permission to make timely investments, but wants to be sure that at the next meeting the Board is notified of what went on. Lubovich read the paragraph with the changes as follows: "That the Firemen's Relief and Pension Board give the City of Kent's Finance Director or his/her designee the authority to make investment decisions and to make retirement and other payments or transfers to meet the needs of the retirees and their families as directed by the Board and within the guidelines of investments allowable by state law. Investment and payment decisions shall be 2 I subsequently submitted for review and approval at the next Firemen's Relief and Pension Board meeting." All agreed on this wording, and Lubovich noted that this will be contained in the bylaws. REPORT ON OVERPAYMENT OPTIONS Tilley stated that the recalculation summary worksheet includes 5% simple interest, and stated that this should be eliminated. HE MOVED that any overpayments not include interest. He noted that the City had made the error and others should not be charged for it. Houser seconded and the motion carried. Celestine Bridge Berg clarified that Celestine Bridge was not aware of the overpayment, and noted for Lubovich that she receives $161.65 per month. BERG MOVED to not pursue overpayment from Celestine Bridge. Houser seconded. Lubovich expressed concern that the overpayment may be considered a gift of public funds. Houser pointed out that the overpayment is the result of an error made by the City. It was determined that Mrs. Bridge is nearly 80 years old and has no assets. Lubovich stated that under those circumstances the claim could be waived. The motion not to pursue repayment from Mrs. Bridge then carried. Berg said he will visit Mrs. Bridge and inform her of this decision. Robert See Huntington pointed out that, although the interest amount for Mr. See seems high, the calculation is correct. Berg noted that See has been overpaid since December of 1989. Miller clarified that the amount in question goes back only three years. She explained that he is currently receiving payments in the correct amount and that he was not aware that he was being overpaid. McCarthy noted that since he is receiving payments, deductions could be taken out of his checks. TILLEY MOVED to forgive the $18.75 due the City from Mr. See. Berg seconded. The motion carried. Darrel Orndorff Miller and Berg explained that Orndorff was originally out on service disability and was being paid, and that when he changed that, the City erroneously issued him a check rather than deducting the amount he had been paid. Miller noted that Orndorff was notified immediately of the error, and that a bill had been sent. She added for Lubovich that this occurred within the last six months. Berg noted that Orndorff is being paid $43.00 a month from the Firemen's Relief & Pension Fund, and that the State pays him $2,382.00 a month. Miller explained that the $1,129.64 amount is for a six month period. Tilley said that this issue is distinctly different from the other two overpayments, in that Orndorff was aware that he had been overpaid. HE MOVED that the$1,129.64 overpayment to Orndorff be collected, either through time payments or by deductions from his checks. Berg seconded. Huntington noted that if no interest is charged, Orndorff has no incentive to repay. Tilley suggested sending him a letter outlining his repayment options as follows: repay the entire amount in one payment, repay the amount in twelve monthly payments, or if the Board does not hear from him within a certain period of time such as two weeks; that they be authorized to deduct the amount from his checks. 3 Lubovich suggested that someone be authorized to negotiate a satisfactory payment arrangement with Orndorff and bring it back to the Board. It was agreed that the Finance Department should do this. Lubovich suggested that the letter explain that the Board has authorized Finance to seek reimbursement, to note that no interest will be attached if paid back within a certain amount of time, and that if he fails to respond within 20-25 days, 50% of his payment will be deducted from his checks and interest will accumulate. He noted that if Orndorff has other ideas for repayment, the City should be flexible. Miller agreed to write the letter. The motion then carried. It was clarified that the interest rate would be the statutory limit. REPORT ON DEATH BENEFITS - GLENN WEBSTER Berg noted that a copy of the death certificate has been received and that a check went out. HE MOVED to ratify this action. Tilley seconded and the motion carried. Miller noted that when a death is duty-related, there is a $5,000 payment that the survivor can take at any time. Tilley explained that if the $5,000 is taken, the pension stops. OTHER BUSINESS Huntington noted that a Power of Attorney has been received from the Phoenix Investment Fund, and that they would like the Board's proxy for investment of$197,000, so that they can combine this with another fund. He said he had spoken with Piper Jaffrey who explained that this is only a consolidation to make it stronger, and there is not a financial problem. BERG MOVED to not take action on the proxy. Houser seconded, noting that it was received late and there is not enough time to look into it. The motion carried. The meeting adjourned at 6:50 p.m. ��,�?��• �ter..`��r�:��F��., r Brenda Jacober City Clerk/ I I 4